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The corporate jet loophole: A problem Congress could actually fix

A twin engine airplane flies by the tower at St. Louis Regional Airport in Bethalto, Ill., Monday Feb. 25, 2013, before circling to land. The airport is one of 100 airports nationwide with less than 150,000 annual flights that will likely loose their...
A twin engine airplane flies by the tower at St. Louis Regional Airport in Bethalto, Ill., Monday Feb. 25, 2013, before circling to land. The airport is one...

President Obama told the White House Press Corps that the $85 billion cuts to government discretionary spending known as the sequester is “not an apocalypse,” which is pretty much the opposite of what the White House propaganda machine has been rolling out for the past two months.  One of the most apocalyptic images flaunted before the national consciousness has been understaffed and overworked air traffic controllers towers causing Breaking Bad-level destruction on a daily basis.

Today, the National Air Traffic Controllers Association (NATCA) began running a pair of radio ads urging against the $600 million in cuts aimed at the Federal Aviation Administration (FAA) in the coming months.  In a February 14 letter to the Senate Appropriations committee, Secretary of Transportation Ray Lahood described the effects of the sequester on the FAA.  He wrote:

 “The furlough of a large number of air traffic controllers and technicians will require a reduction in air traffic to a level that can be safely managed by the remaining staff.  The result will be felt across the country, as the volume of travel must be decreased.”

The letter goes on to mention that “civil aviation contributes 10 million jobs and $1.3 trillion annually to the U.S. economy,” and this is still likely a modest figure when long-distance commerce facilitated by air travel is included.  The FAA serves as a prime example of the “ripple effects” the economy faces should sequester cuts proceed in their current form.

Enter the corporate jet tax loophole.  A friendly line in the tax code that allows a depreciation schedule of five years for private jets as opposed to seven years for other airlines contributes over $300 million to the annual debt tally. Bringing corporate jet tax rates into line with the rest of the aviation industry, and redirecting those funds to maintain the FAA, would cover more than half of the sequester cuts.  The rationality of this approach is compounded by a follow up letter from Secretary LaHood that details which airports will be most affected by the cuts. Smaller airports, the types most frequented by smaller aircraft such as corporate jets, may lose their control towers altogether, while others stand to lose overnight service.

Closing corporate jet loopholes to help fund airports that corporate jets rely on makes sense. It’s the type of common sense tax reform that the White House has called for. It’s also an example of raising revenue by closing loopholes, not raising rates,  that the Republicans sought out in the fiscal cliff debates.

Instead of throwing out rhetoric and platitudes, both sides of the debate should pick specific issues --like transportation--and hash out budget deals on a case-by-case basis instead of both parties tying themselves to a missile and arguing over who brought the rope until the whole thing goes boom.